Adjusted EPS Increases YOY to $0.24 from $0.06; Sales Grow 17%

Confirms Full-Year 2016 Guidance of $1.30 to $1.40 Adjusted EPS

BUFFALO, N.Y.--(BUSINESS WIRE)--May 6, 2016-- Gibraltar Industries, Inc. (Nasdaq: ROCK), a leading manufacturer and distributor of building products for industrial, infrastructure, residential, and renewable energy and conservation markets, today reported its financial results for the three-month period ended March 31, 2016. All financial metrics in this release reflect only the Company’s continuing operations unless otherwise noted.

First-quarter Consolidated Results

Gibraltar’s net sales for the first quarter of 2016 increased 17 percent to $233.7 million, compared with $200.6 million in the first quarter of 2015. First-quarter adjusted net income was $7.6 million, or $0.24 per diluted share, compared with $1.8 million, or $0.06 per diluted share, in the first quarter of 2015. The adjusted first-quarter 2016 results exclude special items with an after-tax net charge totaling $1.1 million, or $0.04 per diluted share, resulting primarily from business restructuring under the 80/20 simplification initiative. The adjusted first-quarter 2015 results excluded special items with an after-tax net benefit totaling $3.7 million, or $0.12 per diluted share, resulting primarily from a gain on the sale of a facility, partially offset by costs related to the Company’s senior leadership transition. Including these items in the respective periods, the Company’s first-quarter 2016 GAAP net income was $6.5 million, or $0.20 per diluted share, compared with a net income of $5.5 million, or $0.18 per diluted share, in the first quarter of 2015.

Management Comments

“Gibraltar began 2016 with a strong first-quarter performance as we exceeded our guidance on both the top and bottom lines,” said Chief Executive Officer Frank Heard. “We reported an over 300 percent increase in adjusted net income on a 17 percent increase in sales as a result of significant gains from our value creation strategy and the benefits of our June 2015 acquisition of Rough Brothers Inc. (RBI). RBI continues to leverage solid top-line growth into strong profitability.

“Our positive financial results in recent quarters reflect a rapid culture transformation at Gibraltar, which has led to significant operational improvements across the organization. We have made excellent progress in re-focusing our resources and increasing efficiencies. As a result, we have delivered increased profitability out of our base businesses despite market headwinds,” Heard said.

First-quarter Segment Results

Residential Products

First-quarter 2016 net sales in Gibraltar’s Residential Products segment decreased 6 percent to $100.1 million, compared with $106.8 million for the first quarter of 2015, reflecting the completion of a significant contract for centralized mailboxes as of December 2015. First-quarter 2016 adjusted operating margin increased to 13.2 percent compared to 7.7 percent in the prior-year period. The segment’s adjusted operating margin reflected the benefit of improved operational efficiencies and early contributions from the 80/20 simplification initiative.

Industrial and Infrastructure Products

First-quarter 2016 net sales in Gibraltar’s Industrial & Infrastructure Products segment decreased 15 percent to $79.7 million, compared with $93.8 million for the first quarter of 2015. However, adjusted operating margin doubled to 5.0 percent as the combination of improved manufacturing efficiencies, tighter management of raw material costs, and initial benefits from 80/20 simplification helped offset the effect of the revenue decrease. Sales in this segment reflected lower shipment volumes plus the effect of lower steel costs on customer pricing. First-quarter volume was lower year-over-year by 9 percent as domestic energy and mining activity declined, in part, due to the effects of reduced oil prices.

Renewable Energy and Conservation

This newly named segment contains the results of RBI, an acquisition the Company completed on June 9, 2015. RBI has established itself during the past six years as North America’s fastest-growing provider of solar racking solutions. RBI was accretive to the Company’s results, adding adjusted earnings of $0.09 per diluted share to the first quarter, on revenues of $53.9 million.

The first-quarter 2016 net sales of $53.9 million represent an increase of 35 percent, compared to $39.9 million for the first quarter of 2015 (prior to the acquisition by Gibraltar). Sales growth in this segment reflected continued strong demand for RBI’s ground-mounted solar racking products as well its commercial greenhouse products.

Business Outlook

“Looking ahead in 2016, we will build on our previous successes to advance our four pillar strategy, which includes operational improvement, portfolio management, product innovation plus accretive acquisitions which serve as strategic accelerators to growth. As a result, even with continued softness in certain end markets, we expect to achieve our key financial objectives for 2016: increasing earnings, making more efficient use of our capital, and delivering higher shareholder returns than we did in 2015.”

Gibraltar expects 2016 total revenues in the range of $1.04 billion to $1.06 billion, an increase of approximately 1 percent compared with $1.04 billion in 2015, led by continuing growth in sales of solar racking. This revenue range for 2016 is lower than previous guidance due to the Company’s divestiture in April 2016 of its European industrial business that contributed $36 million in revenues with breakeven profitability to our Industrial & Infrastructure Products segment in 2015. Despite expected modest revenue growth this year, Gibraltar is confirming its guidance for higher adjusted earnings for full year 2016. Adjusted earnings for 2016 are expected in the range of $1.30 to $1.40 per diluted share, compared with $1.09 per diluted share in 2015.

For the second quarter of 2016, revenues are expected to increase 7 to 8 percent and adjusted EPS are expected to be between $0.36 and $0.41, compared with $0.25 for the second quarter of 2015, as a result of the income from the Renewable Energy and Conservation segment and continuing operational efficiencies.

First-quarter Conference Call Details

Gibraltar has scheduled a conference call today starting at 9:00 a.m. ET to review its results for the first quarter of 2016. Interested parties may access the call by dialing (877) 407-5790 or (201) 689-8328. The presentation slides that will be discussed in the conference call are expected to be available this morning, prior to the start of the call. The slides may be downloaded from the Gibraltar website: www.gibraltar1.com. A webcast replay of the conference call and a copy of the transcript will be available on the website following the call.

About Gibraltar

Gibraltar Industries is a leading manufacturer and distributor of building products for industrial, infrastructure, residential, and renewable energy and conservation markets. With a four-pillar strategy focused on operational improvement, product innovation, acquisitions and portfolio management, Gibraltar’s mission is to drive best-in-class performance. Gibraltar serves customers worldwide through facilities in the United States, Canada, Germany, China, and Japan. Comprehensive information about Gibraltar can be found on its website at www.gibraltar1.com.

Safe Harbor Statement

Information contained in this news release, other than historical information, contains forward-looking statements and is subject to a number of risk factors, uncertainties, and assumptions. Risk factors that could affect these statements include, but are not limited to, the following: the availability of raw materials and the effects of changing raw material prices on the Company’s results of operations; energy prices and usage; changing demand for the Company’s products and services; changes in the liquidity of the capital and credit markets; risks associated with the integration and performance of acquisitions; and changes in interest and tax rates. In addition, such forward-looking statements could also be affected by general industry and market conditions, as well as general economic and political conditions. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law or regulation.

Non-GAAP Financial Data

To supplement Gibraltar’s consolidated financial statements presented on a GAAP basis, Gibraltar also presented certain adjusted financial data in this news release. Adjusted financial data excluded special charges consisting of gains / losses on sales of assets, restructuring primarily associated with the 80/20 simplification initiative, acquisition-related items, and other reclassifications. These adjustments are shown in the non-GAAP reconciliation of adjusted operating results excluding special charges provided in the financial schedules that accompany this news release. The Company believes that the presentation of results excluding special charges provides meaningful supplemental data to investors, as well as management, that are indicative of the Company’s core operating results and facilitates comparison of operating results across reporting periods as well as comparison with other companies. Special charges are excluded since they may not be considered directly related to our ongoing business operations. These adjusted measures should not be viewed as a substitute for our GAAP results, and may be different than adjusted measures used by other companies.

Next Earnings Announcement

Gibraltar expects to release its financial results for the three-month period ending June 30, 2016, on Thursday, July 28, 2016, and hold its earnings conference call later that morning, starting at 9:00 a.m. ET.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160506005319/en/

Source: Gibraltar Industries, Inc.

Gibraltar Industries, Inc.
Kenneth Smith, 716-826-6500 ext. 3217
Chief Financial Officer
kwsmith@gibraltar1.com